AQA A level Business Studies |
Questions And Answers | Latest Exam
2026-2027 | Graded A+
What is a business objective? Why is one needed? -ANSWER - It is a goal for the entire
organisation
- They guide the actions of those withing the business
What are the main objectives a business might have? (8) -ANSWER - Growth
- Reduction of risks / diversification
- Profit (reduce production costs / increase price)
- Survive (applicable for most start-up companies
- Cash flow objective (making sure the cash flowing into a business is enough to cover
what must pay out in any period)
- Ethical objectives (environment, fairtrade etc)
- Becoming the market leader
- Stakeholder Objectives (keeping the shareholders / employees / government happy)
What is a Stakeholder? -ANSWER A stakeholder is an individual / group of peope with an
interest in the business e.g - workers, shareholders, government etc
What is a public limited company? -ANSWER A company that is owned by shareholders
(generally a larger company)
What does niche mean? -ANSWER A small specific market aimed at only a few types of
people
How is profit calculated? -ANSWER total revenue - total cost
(money in - money out)
What are the two types of costs? What are they and what are some examples? -
ANSWER Fixed cost and Variable cost
Fixed - If output changes, fixed costs do not change
e.g - rent of the building, salary of the worker
Variable - As output changes, so do variable costs
e.g - costs of materials
What do the letters SMART stand for in regards to business objectives? -ANSWER
Specific
Measurable
Agreed
,Realistic
Timescale
^ used for making company goals
What does qualitative mean? -ANSWER With no data / facts
What is a mission statement? -ANSWER A qualitative statement of an organisation's
aims that uses language intended to motivate employees and convince customers,
suppliers and those outside the firm of it's sincerity and commitment
How and why does a company's mission link to its objectives? -ANSWER - Objectives
allow companies to reach the aims in their mission statement
- A company must understand it's mission / overall goals to form objectives
How do we structure an 8 mark analysis question? -ANSWER PECAn
Point
Explain
Context
Analysis
What is the difference between a public and a private sector business? -ANSWER Public
sector - controlled by the government (things we should all have the right to)
Private sector - privately owned (shareholders / owners)
What are some examples of each business sector? -ANSWER Public - BBC, NHS,
Ofsted
Private - ITV, Bupa, Coca-Cola
What are the advantages of private over public sector and vice-versa? -ANSWER Public -
more available, worse service, paid for through tax (funded by the government)
Private - less available, better service (each company is competing for your money),
paid for directly by the consumer
What is the difference between an incorporated and unincorporated business? -ANSWER
An unincorporated business is a business whereby there is no legal distinction between
the business and the owner.
An incorporated business has a separate legal identity to its owner(s).
What is a liability? -ANSWER A debt or financial obligation for which someone is
responsible
What is the difference between limited and unlimited liability? Which kinds of
businesses have which kind of liability? -ANSWER Unlimited: The owner(s) is personally
responsible for the company (possessions can be repossessed)
, Limited: Owner / shareholders are not personally responsible for the company
An unincorporated business have unlimited liability. An incorporated business will have
limited liability
What is a Sole Trader? What kind of liability do they have? -ANSWER A Sole Trader is
one person setting up their own business. They have Unlimited Liability
What are some Pros and Cons of being a Sole Trader? -ANSWER Pros: You get all the
profit
Cons: There's much more risk, possessions can be repossessed, you have to rely on
yourself / external corporation if you have any problems
What is a Partnership? What kind of liability do they have? -ANSWER 2 or more people
with an equal share in the company.
They have Unlimited Liability
What are some Pros and Cons of being in a Partnership? -ANSWER Pros: Distributes
risk, increases growth which means increased profits, increased budget
Cons: Still liable for the company, less percentage of the profit goes to the original
owner
What is a Private Limited Company (LTD)? What kind of liability do they have? -ANSWER
Has shareholders, but only those invited.
They have Limited Liability
What are some Pros and Cons of an LTD? -ANSWER Pros: Less risk because you're not
liable, less risk than a PLC because it's not public, so no risk of a takeover, even more
increased growth
Cons: Less percentage of the profit goes to the original owner
What is a Public Limited Company (PLC)? What kind of liability do they have? -ANSWER
A company on the stock exchange (any member of the public can become a
shareholder)
They have limited liability.
What are some Pros and Cons of a PLC? -ANSWER Pros: Bigger overall company,
greater growth / profits
Cons: - Legally requires transparency in financial records (since it's public)
- At risk of a hostile takeover (where an individual / individuals obtain 51% or more of
the total overall shares)
- Less percentage of the profit goes to the original owner
Which legal business structures have shareholders? -ANSWER LTD's and PLC's
Questions And Answers | Latest Exam
2026-2027 | Graded A+
What is a business objective? Why is one needed? -ANSWER - It is a goal for the entire
organisation
- They guide the actions of those withing the business
What are the main objectives a business might have? (8) -ANSWER - Growth
- Reduction of risks / diversification
- Profit (reduce production costs / increase price)
- Survive (applicable for most start-up companies
- Cash flow objective (making sure the cash flowing into a business is enough to cover
what must pay out in any period)
- Ethical objectives (environment, fairtrade etc)
- Becoming the market leader
- Stakeholder Objectives (keeping the shareholders / employees / government happy)
What is a Stakeholder? -ANSWER A stakeholder is an individual / group of peope with an
interest in the business e.g - workers, shareholders, government etc
What is a public limited company? -ANSWER A company that is owned by shareholders
(generally a larger company)
What does niche mean? -ANSWER A small specific market aimed at only a few types of
people
How is profit calculated? -ANSWER total revenue - total cost
(money in - money out)
What are the two types of costs? What are they and what are some examples? -
ANSWER Fixed cost and Variable cost
Fixed - If output changes, fixed costs do not change
e.g - rent of the building, salary of the worker
Variable - As output changes, so do variable costs
e.g - costs of materials
What do the letters SMART stand for in regards to business objectives? -ANSWER
Specific
Measurable
Agreed
,Realistic
Timescale
^ used for making company goals
What does qualitative mean? -ANSWER With no data / facts
What is a mission statement? -ANSWER A qualitative statement of an organisation's
aims that uses language intended to motivate employees and convince customers,
suppliers and those outside the firm of it's sincerity and commitment
How and why does a company's mission link to its objectives? -ANSWER - Objectives
allow companies to reach the aims in their mission statement
- A company must understand it's mission / overall goals to form objectives
How do we structure an 8 mark analysis question? -ANSWER PECAn
Point
Explain
Context
Analysis
What is the difference between a public and a private sector business? -ANSWER Public
sector - controlled by the government (things we should all have the right to)
Private sector - privately owned (shareholders / owners)
What are some examples of each business sector? -ANSWER Public - BBC, NHS,
Ofsted
Private - ITV, Bupa, Coca-Cola
What are the advantages of private over public sector and vice-versa? -ANSWER Public -
more available, worse service, paid for through tax (funded by the government)
Private - less available, better service (each company is competing for your money),
paid for directly by the consumer
What is the difference between an incorporated and unincorporated business? -ANSWER
An unincorporated business is a business whereby there is no legal distinction between
the business and the owner.
An incorporated business has a separate legal identity to its owner(s).
What is a liability? -ANSWER A debt or financial obligation for which someone is
responsible
What is the difference between limited and unlimited liability? Which kinds of
businesses have which kind of liability? -ANSWER Unlimited: The owner(s) is personally
responsible for the company (possessions can be repossessed)
, Limited: Owner / shareholders are not personally responsible for the company
An unincorporated business have unlimited liability. An incorporated business will have
limited liability
What is a Sole Trader? What kind of liability do they have? -ANSWER A Sole Trader is
one person setting up their own business. They have Unlimited Liability
What are some Pros and Cons of being a Sole Trader? -ANSWER Pros: You get all the
profit
Cons: There's much more risk, possessions can be repossessed, you have to rely on
yourself / external corporation if you have any problems
What is a Partnership? What kind of liability do they have? -ANSWER 2 or more people
with an equal share in the company.
They have Unlimited Liability
What are some Pros and Cons of being in a Partnership? -ANSWER Pros: Distributes
risk, increases growth which means increased profits, increased budget
Cons: Still liable for the company, less percentage of the profit goes to the original
owner
What is a Private Limited Company (LTD)? What kind of liability do they have? -ANSWER
Has shareholders, but only those invited.
They have Limited Liability
What are some Pros and Cons of an LTD? -ANSWER Pros: Less risk because you're not
liable, less risk than a PLC because it's not public, so no risk of a takeover, even more
increased growth
Cons: Less percentage of the profit goes to the original owner
What is a Public Limited Company (PLC)? What kind of liability do they have? -ANSWER
A company on the stock exchange (any member of the public can become a
shareholder)
They have limited liability.
What are some Pros and Cons of a PLC? -ANSWER Pros: Bigger overall company,
greater growth / profits
Cons: - Legally requires transparency in financial records (since it's public)
- At risk of a hostile takeover (where an individual / individuals obtain 51% or more of
the total overall shares)
- Less percentage of the profit goes to the original owner
Which legal business structures have shareholders? -ANSWER LTD's and PLC's
